In a recent year, the average daily circulation of the wall street journal was 2,276,207. suppose the standard deviation is 70,940. assume the paper’s daily circulation is normally distributed. (a) on what percentage of days would circulation pass 1,801,000? (b) suppose the paper cannot support the fixed expenses of a full-production setup if the circulation drops below 1,632,000. if the probability of this even occurring is low, the production manager might try to keep the full crew in place and not disrupt operations. how often will this even happen, based on this historical information?

1. consider a two-firm industry. firm 1 (the incumbent) chooses a level of output qı. firm 2 (the potential entrant) observes qı and then chooses its level of output q2. the demand for the product is p 100 q, where q is the total output sold by the two firms which equals qi +q2. assume that the marginal cost of each firm is zero. a) find the subgame perfect equilibrium levels of qi and q2 keeping in mind that firm 1 chooses qi first and firm 2 observes qi and chooses its q2. find the profits of the two firms-n1 and t2- in the subgame perfect equilibrium. how do these numbers differ from the cournot equilibrium? b) for what level of qi would firm 2 be deterred from entering? would a rational firm 1 have an incentive to choose this level of qi? which entry condition does this market have: blockaded, deterred, or accommodated? now suppose that firm 2 has to incur a fixed cost of entry, f> 0. c) for what values of f will entry be blockaded? d) find out the entry deterring level of q, denoted by q1', a expression for firm l's profit, when entry is deterred, as a function of f. for what values of f would firm 1 use an entry deterring strategy?